A new California legislation addressing security deposits is due to take effect on July 1, 2024, in a dramatic move aimed at protecting tenants.
The legislation updates existing security deposit regulations, affecting how much landlords can charge tenants for residential leases.
Landlords are currently entitled to charge tenants a security deposit equal to two months’ rent for an unfurnished property and three months’ rent for a furnished unit. This is in addition to charging the first month’s rent.
However, beginning July 1, 2024, landlords will be limited to asking for a security deposit equal to one month’s rent, regardless of whether the property is furnished or unfurnished.
- Property owners who are natural persons or members of a limited liability company comprised entirely of natural persons are exempt from this provision.
- If such owners hold no more than two rental houses with a total of no more than four units, they can charge up to two months’ rent in addition to the first month’s fee.
It is critical to understand that the legislation imposes stringent limitations on charging service members. Landlords cannot charge service members more than one month’s rent plus the first month’s rent as a security deposit, regardless of the owner’s status.
This legislative measure intends to achieve a balance between landlord rights and tenants’ financial well-being, providing greater protection to individuals seeking rental lodgings in the state.